The FDIC has approved new rules easing the enhanced supplementary leverage ratio, reducing how much capital banks must hold against low-risk assets — marking one of the first major rollbacks of post-crisis regulation.
Key Highlights
📉 $13B reduction in required capital for large global banks (<2%)
🏦 Depository subsidiaries see a 27% drop, equal to $213B
📅 Compliance required by April 1, 2026, with voluntary early adoption in 2025
⚠️ Banks cannot increase shareholder payouts, as holding companies remain constrained by other capital rules
Why It Matters
The move aligns with the Trump administration’s push to spur growth by loosening regulations. Officials argue the old rules were too restrictive — especially as rising government debt made leverage requirements increasingly binding.
Regulators also feared strict leverage rules could discourage big banks from supporting Treasury market liquidity during periods of stress.
Small Banks Also Get Relief
A proposed FDIC rule would lower the community bank leverage ratio from 9% → 8% for banks under $10B in assets.
Debate Continues
Supporters say the move frees up lending capacity.
Critics warn it weakens safeguards and increases systemic risk at a time of elevated market volatility.